CEVAP:

The amount of goods and services produced in the economy varies not only with the aggregate expenditures, but also according to the prices the firms require for these goods and services. For instance, if there is an unsold part of production, companies reduce their prices to sell their products. All products are sold with decreasing prices and full employment production level is provided. However, in order to process in
this way, it is necessary to reduce the prices of the production factors. The reason is that the firms whose income has fallen because of falling prices are going to lose their profit if there is no decrease in the costs of production factors. Classical economists argue that in such a case, the prices of production factors will also fall due to the dynamics of perfect competition market. Equilibrium in the labor market will be provided at a lower wage level because of the flexibility of wages and the competition among the workers in the labor market. This equilibrium point is also the point of equilibrium where full employment level is achieved in the labor market.